Mortgage

Can you explain down payments to clients?

A comprehensive look at programs for buyers
  • Assistance programs may offer grants, funds for closing costs, a second loan, a low-interest mortgage with no PMI or a tax credit.
  • Funding comes from federal sources, bond-funded programs, state-sponsored housing and TBA (to-be-announced) and capital markets funding.
  • Without clear guidance, some lenders may decide to pull back on using these programs for fear of an audit.
  • Explore local options and talk to lenders to fully understand the loans they originate.

In a market where first-time homebuyers consistently cite the down payment as their no. 1 challenge, there’s a battle brewing behind the scenes -- a fight to preserve the wide range of down payment programs that propel scores of new buyers into homeownership. More real estate professionals are trying to reach first-time homebuyers -- it’s the future of the market, after all. Many of these buyers may qualify for down payment help, helping boost their buying power and getting them into a home sooner. Even if you already use homeownership programs, you probably find yourself asking: Where does the money come from? How do the programs work? Can my clients benefit? For homebuyers, and many real estate professionals, those answers can be a bit of a mystery. And, unfortunately, politics further muddy the issue, potentially locking out buyers from these healthy, successful programs. Who provides homeownership programs? Homeownership programs (roughly 2,400 available across th...

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